The EU Joins The US's Piracy Complaint Against China

by Ulrika Lomas, for LawAndTax-News.com, Brussels

09 May 2007

The European Union and Mexico followed Canada and Japan last week in saying that they would join the United States' piracy and counterfeiting complaint against China at the World Trade Organization as third parties.

"We want to be involved in this case as we are hurt by counterfeiting and piracy just as much as anyone else, and music and film are particularly affected," said an EU spokesman. "This is obviously a hugely important case for us as well. But at the moment, the case is in a 60-day consultation phase, and we hope to get satisfaction by the end of this."

The EU imports more goods from China than the US and is equally prone to counterfeit DVDs, CDs and computer software. Trade Commissioner Peter Mandelson has persistently urged the Chinese authorities not only to enact tough laws but to implement them effectively across the country.

China has reacted bitterly to the WTO complaint. Last week Vice-Premier Wu Yi said that it was threatening US/China trade relationships. "Regrettably, the United States Trade Representative, the USTR, has totally ignored significant progress China has made," she told a forum held to mark International Intellectual Property Rights Day. "It will have an extremely negative impact. The Chinese government has expressed utter dissatisfaction about this, but we have decided to actively respond [to the cases] according to the related WTO rules and fight to the finish," said Ms Wu, who is the Chinese equivalent of the US Trade Representative.

"It will also inevitably have serious repercussions for bilateral intellectual property co-operation under the Joint Commission on Commerce and Trade framework, and harm the existing co-operation between the two sides on market access for publications," added Ms Wu.

Two weeks ago, the Chinese government set out a wide-ranging action plan on intellectual property for 2007, including dozens of measures covering legislation, enforcement, education, publicity and international co-operation. Chinese courts have recently been taking a much tougher line against IP infringements, and threshhold levels for infringement were reduced in April; but piracy is deeply rooted in the Chinese economy, and it will be years before it comes under control.

The Office of the United States Trade Representative recently published this year's edition of the Special 301 report on the perceived adequacy and effectiveness of intellectual property rights (IPR) protection by US trading partners, and as in previous years, the report highlighted the prominence of concerns with respect to China.

In conjunction with the release of the report, USTR announced the results of an unprecedented year-long review of strengths and weaknesses in IPR protection and enforcement in key Chinese provinces. “Leadership at the provincial and local levels is critical to improving China’s IPR climate,” Trade Representative Susan Schwab explained. “By highlighting local problems and also giving credit where it is due, we encourage local leadership.”

“Our recent decision to pursue IPR-related concerns in China through consultations under WTO dispute settlement rules demonstrates our determination to defend vigorously American innovation,” commented Schwab.

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